Himachal Pradesh chief minister Sukhvinder Singh Sukhu on Sunday expressed strong disappointment over the Union Budget 2026–27, calling it unfair to the state and insensitive to its unique challenges. He described the budget as anti-poor and anti-farmer and said it fails to address the real concerns of hill states like Himachal Pradesh.
Sukhu, who also holds the finance portfolio of the state, said the budget presented by Union finance minister Nirmala Sitharaman completely overlooks Himachal Pradesh’s special geographical, environmental, and economic conditions. According to him, the budget does not reflect equity and ignores key sections of society that need focused support.
The chief minister said Himachal Pradesh had hoped for targeted support in areas that are crucial for a hill state. These include hydropower development, eco-tourism, improved road and rail connectivity, and compensation for revenue losses caused by the implementation of the Goods and Services Tax (GST).
He pointed out that Himachal Pradesh faces higher costs in providing basic services because of its mountainous terrain. Roads, healthcare facilities, schools, and public infrastructure cost much more to build and maintain in hilly regions compared to plains. Despite these realities, Sukhu said the Union Budget does not offer any special financial assistance to address these challenges.
Sukhu also highlighted the state’s environmental responsibilities. Around 67 per cent of Himachal Pradesh’s area is under forest and ecological cover. While this helps protect the environment and contributes to national climate goals, it limits industrial expansion and revenue generation for the state. He said the budget fails to recognise this structural disadvantage.
Another major concern raised by the chief minister was the frequent natural disasters faced by the state. Himachal Pradesh has suffered heavy losses due to floods, landslides, and cloudbursts in recent years, with damages exceeding ₹15,000 crore. Sukhu said the budget does not provide adequate disaster-related support or long-term mitigation funding for such vulnerable regions.
According to him, the overall approach of the budget ignores the ground realities of small and hill states. He said this makes the budget inequitable and disappointing for the people of Himachal Pradesh.
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Sukhu also expressed serious concern over the recently tabled 16th Finance Commission report for the period 2026–31. He said the commission has failed to recommend meaningful Revenue Deficit Grants for Himachal Pradesh, despite repeated requests and detailed submissions made by the state government.
He termed this decision deeply disappointing and unjust, saying it has hurt the sentiments of the people of Himachal Pradesh. He noted that the Finance Commission has not recommended Revenue Deficit Grants for small states, including Himachal, which he said goes against the spirit of cooperative federalism.
The chief minister explained that Article 275(1) of the Constitution provides for state-specific grants from the Union government. From 1952 until the 15th Finance Commission, such grants were regularly given to states facing revenue deficits. However, he said that for the first time, the 16th Finance Commission has discontinued these grants.
Sukhu pointed out that under the 15th Finance Commission, Himachal Pradesh received Revenue Deficit Grants of nearly ₹37,000 crore. These funds helped the state manage its finances and continue providing essential public services. The sudden withdrawal of this support, he said, places a heavy burden on the state’s economy.
Deputy chief minister Mukesh Agnihotri also criticised the Union Budget, calling it a betrayal of Himachal Pradesh’s interests. He said the budget has been unfair to the state and has completely ignored its unique geographical and economic conditions.
However, the budget has received mixed reactions from other political leaders. Leader of the Opposition Jai Ram Thakur described it as a development-oriented and comprehensive budget aimed at achieving the goal of “Developed India 2047.” He welcomed the announcement of developing eco-trails under eco-tourism, calling it a revolutionary step for hilly states like Himachal Pradesh.
Thakur said the projected economic growth rate of 7 per cent and the record infrastructure investment of ₹12.2 lakh crore will provide new momentum to sectors such as information technology, semiconductors, and healthcare. He added that these measures could indirectly benefit Himachal Pradesh as well.
BJP MLA and former speaker Vipin Singh Parmar also defended the budget. He said it offers a clear roadmap to turn the geographical challenges of hill states into opportunities. Parmar stated that giving priority to sectors like tourism, agriculture, skill development, environmental conservation, and job creation shows the Centre’s balanced and sensitive approach.
He added that India’s strong economic performance, despite global uncertainties, proves the strength of current policies and reforms. According to him, special focus on eco-tourism and growth-oriented sectors will help Himachal Pradesh create employment and attract investment.
Despite these differing views, Sukhu maintained that the budget does not meet Himachal Pradesh’s expectations. He said the state was looking for concrete financial support tailored to its needs, not broad policy announcements. According to the chief minister, without targeted assistance, it will be difficult for hill states to overcome structural disadvantages and ensure inclusive development.
Sukhu concluded that the Union Budget 2026–27 misses an important opportunity to support states like Himachal Pradesh that play a crucial role in environmental conservation and national development. He urged the Centre to reconsider its approach and provide fair and adequate support to hill states in the future.
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